WellPoint, Inc., the largest insurer in the United States based on its number of members, blames a 39% rate increase on the rising cost of health care and the effects of the recession, but the Obama administration is singling out the company as clear evidence of the need for the passage of comprehensive health care reform.
The Democrat’s version of the pending health care legislation would prevent a price increase of such magnitude. Proponents have pointed to WellPoint’s action as evidence that insurance companies are not trustworthy and will only act in the best interest of consumers if subject to new levels of regulation.
Republicans find themselves in a difficult position, not able to defend WellPoint, but not in favor of the solutions being proposed by Democrats. Most Republican lawmakers have spoken in favor of a step-by-step response, including high-risk pools for those with medical conditions that might otherwise prevent them from gaining coverage.
Michael Steel, a spokesman for House Minority Leader John Boehner, said that WellPoint’s rate hike does illustrate why reform is needed, but that it does not require measures that amount to a “trillion-dollar government takeover.”
Health and Human Services Secretary Kathleen Sebelius, in a statement issued on Thursday, February 11, 2009, said, “It remains difficult to understand how a company that made $2.7 billion in the last quarter of 2009 alone can justify massive increases that will leave consumers with nothing but bad options: pay more for coverage, cut back on benefits or join the ranks of the uninsured. High health care costs alone cannot account for a premium increase that is 10 times higher than national health spending growth.”